Gov. David Ige’s administration plans to launch a new program to help the struggling local restaurant industry by distributing debit-type cards for unemployed Hawaii workers to use to dine out at local eateries — and let the federal government pick up the tab.

The House Select Committee on COVID-19 Economic and Financial Preparedness on Monday was briefed on the latest plans by the Ige administration to spend hundreds of millions of dollars in federal funds that have been sent to Hawaii to cope with the pandemic, and the proposed new restaurant card is budgeted for $66.6 million.

The state received nearly $863 million in federal funds under the CARES Act in April, but the Ige administration has not said publicly how it plans to spend about $321 million of that money. The administration is now under pressure to use that money quickly because it will have to be returned to the federal government if it is not spent by the end of the year.

The Lanai, Ala Moana Center foodcourt with the dining area closed due to Mayor Caldwell’s stay at home order during a spike of COVID-19 cases on Oahu. Some vendors were open serving take out only during the Mayor’s order. September 3, 2020
The Ala Moana Center food court’s dining area was closed to diners earlier this month during Oahu restrictions that forced restaurants to serve takeout only. A new plan by Gov. David Ige would provide debit-style dining cards to the unemployed using federal bailout money. Cory Lum/Civil Beat/2020

Former state Sen. Jill Tokuda, who is co-chair of the House CARES Funds subcommittee, presented the committee with a list Monday that details about $185 million in new CARES Act spending proposals from the administration, including $35 million for additional COVID-19 testing kits, equipment and logistics.

Also on the list of new spending plans are more than $20.1 million for the University of Hawaii system, and nearly $17.8 million to establish quarantine facilities on Maui, Kauai and Hawaii islands. Another $14 million is earmarked for contract nurses and other health care professionals to help create a “surge capacity” at Hawaii hospitals.

But the largest single item on the list is the $66.6 million for a “Restaurant Cash Card Program,” which is described as a “private-public partnership to provide financial support to unemployment claimants.”

This chart, part of a presentation Monday by the House special committee on COVID-19, shows how $185.1 million of CARES Act money could be spent. Courtesy: Hawaii House

The idea is to provide cards to unemployed workers to use at local restaurants, but no information was available on how much money might be allocated per household or per claimant.

Officials with the state Department of Business, Economic Development and Tourism declined comment on the program, saying they had little or no information about the initiative. An official announcement of the program may come as early as Friday, they said.

Sheryl Matsuoka, executive director of the Hawaii Restaurant Association, said she could not discuss the restaurant card program Monday because as far as she knows it has not yet received final approval from Ige.

The tourism shutdown has idled tens of thousands of workers, and local restaurants have been struggling to survive the pandemic as the flow of tourists was almost completely cut off by the mandatory two-week quarantine for trans-Pacific passengers. Local customers have also been staying home.

But the restaurant industry is a sizable chunk of the Hawaii economy. Employment in the urban Honolulu food service and drinking place categories was 49,700 in January, but dropped to just 27,500 in August. That number is likely to drop further this month because of the second stay-at-home order.

A survey by the National Restaurant Association this month found that 65% of the Hawaii restaurants surveyed said they will close permanently in the next six months if business does not improve.

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